Binance Facilitates Institutional Crypto Trading With New Feature
Institutional investors can now access the Binance ecosystem without posting collateral on the exchange.
by Juan Aranovich, editorial research
Binance, the world's leading crypto exchange, recently unveiled its latest offering, an off-exchange settlement solution 'Binance Mirror'. This allows institutional investors to access trading and investment opportunities within the Binance ecosystem without having to post collateral directly on the exchange.
With Binance Mirror, institutions can lock a specific amount of their assets available in their ‘Qualified Wallet’, Binance Custody's cold storage solution, and mirror it onto their Binance Exchange account, maintaining a 1:1 balance. Their assets remain secure in the segregated cold wallet as long as their Mirror position remains open on the exchange and can be settled at any time.
Binance reported that Binance Mirror saw significant growth in the last quarter of 2022, with a 67% increase in assets mirrored from Binance Custody to the exchange. Currently, investments in Binance Mirror account for more than 60% of all assets secured in Binance Custody, indicating growing institutional confidence in the custodian's off-exchange solution.
"Security is a top priority for institutions, who also desire the deep liquidity that the Binance Exchange offers. Binance Mirror brings the best of both worlds," said Athena Yu, VP of Binance Custody. "We spent much of last year refining its operations to help our clients unlock the liquidity of their assets held in our cold storage. We're very excited about where we are today and can't wait to introduce our upcoming new features that will elevate Binance Mirror's functionality even further."
Binance Mirror represents a significant step forward in fostering trust among institutions regarding the security of their funds. As a leading crypto exchange, Binance's transition towards becoming more institutionally-focused is a positive indication for the industry as a whole. It demonstrates a commitment to meeting institutional investors' specific needs and concerns and creating a more secure and reliable platform for them to conduct their trades.
However, exchanges will likely have to work with external custodians to eliminate collateral ownership risks. This highlights the need for continued innovation and collaboration in the crypto industry to ensure the safety and security of institutional funds.
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